(KMJ) As the death toll climbed to 10 Friday morning, California’s Insurance Commissioner issued a temporary ban on companies canceling or not renewing home insurance coverage for people impacted by the devastating Palisades and Eaton wildfires burning in Southern California.
The moratorium covers those within the perimeters of the fires and adjoining ZIP codes, whether the homeowners suffered a loss or not, for one year from Gov. Gavin Newsom’s Jan. 7 emergency declaration.
Estimates currently range around 10,000 structures having been damaged or destroyed in Los Angeles County.
Mandatory One Year Moratorium on Non-Renewals
Insurance Commissioner Ricardo Lara, while serving as state senator, authored Senate Bill 824 (2018). This consumer protection law requires a mandatory one-year moratorium on insurance companies canceling or non-renewing residential insurance policies in certain areas within or adjacent to a fire perimeter after a declared state of emergency is issued by the Governor.
“Losing your insurance should be the last thing on someone’s mind after surviving a devastating fire,” said Commissioner Lara. “This law gives millions of Californians breathing room and hits the pause button on insurance non-renewals while people recover.”
How the moratorium works
Following a Governor declaration of a state of emergency, the Department of Insurance partners with CAL-FIRE and the Governor’s Office of Emergency Services to identify wildfire perimeters and adjacent ZIP codes within the mandatory moratorium areas. The protection from cancellation or non-renewal lasts for one year from the date of the Governor’s emergency declaration.
This one-year protection applies to all residential policyholders within the affected areas who suffer less than a total loss, including those who suffer no loss. Those who suffer a total loss have additional protections under the law.
Find out if you are protected
Commissioner Lara has implemented the new law following wildfires in 2019, 2020, and 2021. If you live near one of these fires, find the fire name in the list below and click the link to open the Commissioner’s Bulletin for a list of included ZIP codes. If you live in one of those ZIP codes, your insurance company cannot issue a cancellation or non-renewal for wildfire risk for one year from the date of the Governor’s emergency declaration associated with the nearby fire. Below is a list of fires for which Bulletins have been issued since the passage of this new law as well as the Pre-Bulletin Notices for the 2021 fires. The Department continues to coordinate with CalFire and CalOES to identify the various fire and fire perimeters that are subject to the one-year moratorium for the 2021 fires.
If your ZIP code is included in the moratorium and you received a notice of cancellation or non-renewal for wildfire risk, you should contact your insurance company to seek a reinstatement of the policy. If your insurance company refuses, you are encouraged to contact us and file a Request for Assistance.
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“Prop 103 is essentially price controls,” said Steven Greenhut, western region director for the R Street Institute in Sacramento. “It puts the kibosh on the ability of insurance companies to adjust the rates to meet the market,” he told Fox Business.
Greenhut said because of this long-running process, insurance companies began pulling out of California after the previous bout of wildfires that caused extensive destruction in the state a handful of years ago because carriers were not able to quickly adjust rates.
Wednesday in Santa Monica, Governor Newsom and President Biden were briefed by local and state emergency officials on the Palisades, Eaton, and Hurst fires. Shortly after the briefing, President Biden approved Governor Newsom’s request for a Presidential Major Disaster Declaration to support ongoing response efforts related to the major wildfires.
The President then authorized increasing federal assistance to cover 100% of California’s fire management and debris removal costs for 180 days, up from the traditional 75%.
This declaration makes available federal funding to help state, tribal and local governments cover emergency response costs. It also includes Individual Assistance programs for affected citizens and businesses, which may include temporary accommodation and financial assistance for destroyed property. Californians can apply now for federal assistance at disasterassistance.gov.
